Advice for Establishing Savings Goals In 2022
Saving more money is one of the most common New Year’s resolutions that people have every year but most of the time a lot of people fail to fulfil this goal and unfortunately fall back into their old ways of struggling to get on top of this money related goals.
It is super important to have money in your savings account so that you are prepared for any emergencies or unplanned bills that pop up. It is important to have money in your savings account to make it easier for you to accomplish your long-term goals such as; buying a house or being able to eventually retire.
If you are hoping to save more money in 2022, the worst thing you could do is to set a goal for yourself that is extremely unrealistic. If you do set a goal that is too high you are most likely going to set yourself up for failure and possibly overwhelm yourself. Here is some helpful tips that will make it easier for you to establish your savings goals for the new year that are easily attainable.
Assess Your Current Savings
If you are fortunate enough to have a decent emergency fund and you are content with your current superannuation balance you might not be required to save as much money as someone who has little to no emergency funds savings or retirement savings. Take a look at your savings and see where things stand. That will help you determine how much sacrifice may be necessary to reach your goals.
Set Up A Budget Based on Your Expected Income
Mapping out your ongoing expenses will make it easier for you to figure out how much money you can reasonably expect to save on a monthly basis based on your current spending habits. It is recommended that you make a list of your various bills and see what they amount to. Then, compare that number to what your anticipated pay check will look like in 2022 (keeping in mind that a raise might take effect in January).
For example, if your expenses currently total $3,000 a month and you have a $3,300 monthly pay check to look forward to, this ultimately means you could end up saving $3,600 in 2022. And that's without having to make any lifestyle changes.
Think About What Expenses You Are Able to Reduce
Your budget might reflect your living costs today. However, if you don't like what your savings potential looks like without cutting expenses, then you may need to make changes.
If your savings need some serious improvement, it may be a good idea to make some sacrifices to increase it in whatever way you can. However, if you're doing okay savings-wise, you may not have to push yourself to give up as many things. However, you will still need to go back through your budget and see what bills you can cut, whether it's a leisure activity or your monthly cable fees.
Think About Taking Up A Side Hustle
Even if you manage to successfully trim your expenses, you might want to aim for a higher savings target than what your pay check enables you to do. You could accomplish this by starting a side hustle to make some extra cash.
At first it might be difficult to estimate your side hustle earnings before starting that gig. However, if you know most businesses in your area pay $20 an hour for weekend shifts and you're willing to work three weekends a month, you can get a rough estimate of your extra income, add it to your existing pay check, and see what savings potential you're left with.
